Entity Formation Service

Conducting your trading business in an entity unlocks several additional tax benefits.

October 21, 2021 update: It’s too late to commence our trader entity formation service to be effective for 2021. We require that the entity be operational and eligible for TTS for a minimum of Q4 2021. One quarter doesn’t give you much time to maximize employee benefits (health and retirement). Focus on forming an entity for Q1 2022.

  • We can form a single-member LLC (SMLLC) in late November or December 2021, obtain the EIN so you can open the LLC trading account with the broker to be ready to trade on January 1, 2022. We can add your spouse to the LLC operating agreement for a partnership as of January 1, 2022, or we can file a 2022 S-Corp election by March 15, 2022. As an SMLLC “disregarded entity” in 2021, it won’t have a tax filing for 2021. This strategy gives you tax benefits for all of 2022, but not 2021. 
  • We temporarily removed the button to purchase our entity formation service, and we will add it in November 2021.

Start the entity formation process with a 50-minute consultation soon. We will evaluate whether you are eligible for trader tax status (TTS) in 2021 and if you plan to qualify in 2022. Our trader entity tax strategies require TTS as a starting point. With TTS, sole proprietors, LLCs, S-Corps, and partnerships deduct business expenses, startup costs, and home office expenses. A TTS S-Corp is necessary to arrange health and retirement plan deductions for the owners. LLC/partnerships help ring-fence trading positions vs. investments. Pass-through entities can save taxes with the SALT cap workaround strategy. 

Entity Formation Service

We offer our entity formation service to traders eligible for trader tax status (TTS) and proprietary traders. We do not offer it to investment managers or other types of businesses. Read Entity Solutions.

Our entity formation service includes a 60-minute meeting with Robert A. Green, CPA, to form the company, and a 15-minute follow-up consultation with Adam Manning CPA approximately 30 days later to review execution and begin tax planning. Our service includes:

  • Finalize the entity plans from the consultation and form an LLC or corporation using our BizFilings services (see below).
  • We go through formation and start-up tax issues, including ownership percentages with a spouse, profit-sharing allocations, initial capital contributions, and tax elections (S-Corp, Section 475 MTM securities, Section 988 forex). We also cover employee-benefit plan deductions (retirement and health), payroll planning, tax strategies, Section 195 start-up cost, Section 248 organization expenditures, banking needs, accounting solutions, S-Corp expense reimbursement (accountable) plans, and tax planning.

BizFilings online incorporation service

We use bizfilings.com for forming LLCs and corporations in all states. We don’t need an online incorporation service for creating general partnerships. We use their service during our meetings, and the client pays the cost directly by credit card. (Bizfilings pays Green & Company, Inc. a commission.)

Outside attorney service for legal paperwork

We are not a law firm, and you should consider engaging an outside attorney for legal services. We’ll recommend an attorney that has worked with us for many years, and she can handle the execution of the legal paperwork, including:

  • Corporations and LLCs: an online application for federal EIN (tax identification number); guidance on applicable local laws about tax registration. For LLCs: customized standard operating agreement and resolutions for those electing or considering S-corp status; state and federal S-corp election preparation. For corporations: customized standard bylaws, minutes of the first shareholder meeting and resolutions; resolutions for those electing or considering S-corp status; preparation of state and federal S-corp election.
  • Partnerships: name check, guidance on the applicable local law on fictitious business names (FBNs), online application for EIN, advice on the relevant local law about tax registration, customized standard partnership agreements, and resolutions.
  • Disclaimer: Our outside attorney and BizFilings advise clients throughout the U.S. Some issues vary by state, county, city, and town jurisdiction. Consider getting local attorney advice for compliance when appropriate. There are other issues to consider, like local property taxes, too.
  • Price: Our outside attorney charges $235 for most of these engagements (if you have a profit-allocation clause, the cost is $340). We will email you a link to the attorney’s website for engaging her during the entity formation process.

Total Costs

Our entity formation service fee is $525. Our outside attorney is $235.

Add the $99 bizfilings online incorporation fee (plus $60 if you want it expedited) and $125 for average state filing fees (all states vary). This totals approximately $1,000+.

After the entity formation service is completed, you probably want our tax compliance service, and we should be able to accommodate you. See our tax compliance service page for details. 

If you have any questions about our entity formation services, don’t hesitate to contact us.

We look forward to working with you soon.

Members and CPAs, Robert A. Green, Darren L. Neuschwander and Adam W. Manning